When President Obama signed the American Recovery and Reinvestment Act into law on February 17, 2009, the program’s place in American history was widely remarked. It was the greatest stimulus effort since Franklin Roosevelt’s New Deal.

But this was incorrect: By every measure, Obama’s stimulus was far greater than FDR’s New Deal. It involved more dollars in absolute terms and even accounting for inflation. It represented a far greater share of the U.S. economy. It was openly devoted to fiscal stimulus in a way that the original New Deal hadn’t approached until five years of FDR’s administration had already elapsed. And its impact on the economy has been far more pronounced than that of the New Deal.

Yet most Americans seem to be laboring under the misapprehension that the Obama stimulus has failed.

In The New New Deal: The Hidden Story of Change in the Obama Era, Michael Grunwald documents the very real achievements of Obama’s $800-billion stimulus, chronicles its painful gestation both within the White House and in Congress, and ponders why its success has not been given its due. Grunwald, a senior national correspondent at Time and winner of the George Polk Award for national reporting among other laurels, had exceptional access to the architects of the stimulus program. More to the point, The New New Deal gives us not only a broad picture of its stormy course toward enactment and its sometimes inept execution, but also of how it has changed the lives of the millions of Americans it has provided with new jobs or saved jobs, with more money in the pocket, and with access to new technologies that will transform our world.

Grunwald tells a story filled with colorful heroes and villains: Berkeley economist Christina Romer, an expert in Great Depression history, who along with other newcomers to the White House found herself grappling with ever more grim indicators of the magnitude of the economic collapse even as she tried to map out a stimulus that would be big enough to work but not too big to be passed. The conflicts involving Romer and Obama economic aides Larry Summers and Austan Goolsbee have been chronicled elsewhere, but never outlined with as solid a sense of what was in stake as it is here.

The New New Deal is especially good on the Administration’s difficulty communicating the logic and the success of the stimulus to voters. One reason was the obdurate opposition of Congressional Republicans, who in their determination to take back the White House in 2012 shed all responsibility for succoring Americans through the worst slump in eight decades. In Grunwald’s telling, the villain of the piece may be Senate Minority Leader Mitch McConnell, who united his caucus behind the idea that they could not yield on a single point, lest they give the Democrats a success story to exploit for Obama’s reelection campaign.

Another dysfunctional player: The press. Ignorant and math-challenged reporters seized on manifestly misleading yarns of programmatic waste to undermine perceptions about the program’s aims and successes. Let McConnell slander a legitimate livestock disaster program as “honeybee insurance,” or let Louisiana Governor Bobby Jindal ridicule a volcano monitoring program in a nationwide television appearance—the press ate it up, overlooking real gains at job-creating infrastructure construction sites at their back doors.

That the stimulus raised gross domestic product by as much as two percentage points, created or saved millions of jobs that might have been lost had the slump taken its course, that didn’t seem to be news. But addiction research using primates that could be ridiculed as “monkeys on cocaine”—that was always worthy of Page-One play. Small wonder that a poll in 2010 determined that only 6% of Americans thought the stimulus had created any jobs, or that Obama, considered to be one of the premier communicators in American politics, couldn’t communicate the simple fact that it had created millions.

The New New Deal poses compelling questions about our economics and our politics, and about the different approaches to both by Barack Obama and Franklin D. Roosevelt—the latter of whom faced his own challenges in communicating his achievements to his voters and maintaining support for his program among progressives in the Thirties—on both sides of the political aisle. The issues raised in this fascinating book span the decades, and we should all look forward to a vigorous and wide-ranging forum.

[As a courtesy to our guests, please keep comments to the book and be respectful of dissenting opinions. Please take other conversations to a previous thread. - bev]

179 Responses to “FDL Book Salon Welcomes Michael Grunwald, The New New Deal: The Hidden Story of Change in the Obama Era”

Mike, Welcome back to the Lake and thank you for Hosting today’s Book Salon.

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Hello, everyone. This is Michael Hiltzik, author of The New Deal: A Modern History, and I’ll be moderating our discussion with Mike Grunwald, author of The New New Deal, which updates progressive policy-making in times of economic stress to our own times. I’ll launch the forum with an invitation for Mike to start by talking a little about your voyage of discovery that the Obama stimulus worked—did you have that sense before starting work on the book, for example—or did the book result from your feeling that this story wasn’t being told?—did you have that sense before starting work on the book, for example—or did the book result from your feeling that this story wasn’t being told?

Hey, just wanted to start by saying that it’s a pleasure to be here at FDL. I’m especially delighted by the kind words from Michael Hiltzik, who is not only an excellent writer about modern politics, but is a revered historian about the Old New Deal. I’ll answer your first question in my next post.

I spent nine years in DC at The Washington Post, but I now live in the public policy paradise of South Beach. (My last book was about the Everglades – and I met a girl.) And I have to say: I don’t think I could have written this book if I still lived in DC. The groupthink was just too strong. It’s just totally uncool to talk about the stimulus without rolling your eyes and snickering. But 1000 miles away, I was only vaguely aware of the conventional wisdom that the stimulus was an $800 billion joke. And because I write a lot about energy and the environment, I became aware that there was $90 billion in the stimulus for clean energy, when we were spending just a couple billion a year. It looked like a typo: order-of-magnitude increases in funding for renewables, efficiency, the smart grid, advanced biofuels, electric vehicles, the factories to make all that green stuff in the US, the entire low-carbon food chain. It was the biggest energy bill in history, by far. And it got me thinking: What else is in the stimulus? So as a dogged investigative reporter, I did a Google search. And the first thing that came up was Race to the Top. I knew that was a landmark education reform, but I had no idea it was part of the stimulus. Ditto for $27 billion to drag our pen-and-paper health care system into the digital era, so that doctors stop killing us with their chicken-scratch handwriting. And high-speed rail, the largest transportation initiative since Eisenhower. And high-speed Internet for undeserved communities, a modern take on the New Deal’s rural electrification. And new ways of doing unemployment insurance, homelessness prevention, financing of local infrastructure. And the largest research investments ever. And so on, and so on. It became obvious that there was a gigantic story hiding in plain view.

Since you mentioned the energy program, that that provides me with my first straight line of the afternoon: The stimulus program’s advanced energy efforts are the most notable thread in The New New Deal—almost its narrative spine. What led you to see these afforts as emblematic of the whole?

I want to focus on dakine01′s point that the stimulus seemed too small, because I know that’s a real concern (best articulated by Paul Krugman) for many on the left. And it was too small. More aid to states would have saved more jobs of teachers and cops. More public works would have created jobs for more unemployed laborers. More tax cuts would have put more money in your wallet to spend on food and clothing and Xboxes or whatever.

But my reporting makes absolutely clear that President Obama couldn’t have gotten one dime more than he got. Remember: after Lehman Brothers collapsed, Democrats couldn’t even get a $50 billion stimulus out of the Senate. After Obama was elected, 387 left-leaning economists urged Congress to pass a $300B-$400B stimulus. And if you wanted to pass an economic recovery package during an economic emergency, you still needed 60 votes. The three moderate Republicans in the Senate all insisted that it couldn’t be bigger than $800B – and so did at least a half dozen centrist Democrats, which has never been reported before. Obama and his economic team were pushing for more – we can talk about some of the internal dynamics on that team – but President Mark Begich of Alaska wasn’t going to allow it. And legislation that doesn’t pass Congress doesn’t make change.

Incidentally, Obama quietly passed another $700B worth of stimulus over the next two years, even though Republicans were fighting him tooth and nail, even on traditionally bipartisan stuff like small-business tax cuts and unemployment benefits. He did pretty well to get what he got.

Four quick reasons: 1. A relentless Republican campaign of distortion that portrayed the stimulus as a big-government mess. 2. Overly nuanced and sometimes incoherent Democratic messaging efforts that I detail in the book. 3. A brain-dead media culture that isn’t willing to call a lie a lie. (Also detailed in the book!) 4. Most important: it’s hard to sell a jobs bill when jobs are hemorrhaging. The US lost 800K jobs in January 2009. The stimulus passed in Feb, and the next quarter saw the biggest improvement in 30 years. But it still felt dreary. No stimulus could have turned things around fast enough to make people feel good – the financial earthquake had hit under Bush, but the economic tsunami was just reaching the shore.

You won’t have to convince me the stimulus and the resulting trillion dollar deficits for four years have done a great deal of good. I am surprised the administration has not gotten any credit for it. I suppose that is bc unemployment is still quite high?

Hello and thanks for chatting today about your book, which I confess I have not read.

Why has Team Obama kept these secrets? It’s as if they are ashamed of the success of their stimulus, allowing Congresspersons who opposed it (Paul Ryan, et al) to take credit for it in their own districts but overlook the overall impact. Why can’t these people articulate what they’ve done well?

It seems as if they cede the ground to their opponents on the basis of civility and then get torn up all over the political discourse. Why can’t Team Obama do better about bragging on its success?

I have to say the messaging, even directly at the point-of-spending, has been quite dire. There will be a big sign at the entrance to a dreadful construction zone, as if to say, “Today’s traffic delays are brought to you by Barack Obama!” and then, when the work is done and the traffic is much better than before, the signage disappears.

The alternative media wasn’t much better! I do tell a frustrating story about Obama setting up interviews in 1/09 with all five major anchors, to try to correct the misperceptions that the stimulus was a big Porkulus of mob museums and levitating trains to Disneyland and condom subsidies and so forth. And that morning, Tom Daschle withdrew his nomination to the Cabinet, so all the questions were about how Obama screwed up. I go through all kinds of messaging mistakes, and in my view the biggest was focusing on x million short-term jobs rather than the New New Deal that would transform the American economy (energy, health care, education, transportation, research, etc.) for the long term. But ultimately, Obama was on to the next crisis, while Republicans never wavered from their monomaniacal message that everything he did was big-government lunacy. And the bully pulpit is somehwat overrated when unemployment is approaching double digits.

Continuing the theme of communicating: One thing many people have spoken about, and you mention in your book, is the lack of a single, much less several, signature physical projects for Obama to point to to bring home the scale of the stimulus.

Roosevelt was a master of this—he even appropriated Hoover Dam as a symbol of the New Deal’s public works, though his administration had really nothing to do with it. Is there anything Obama could have pointed to that would serve the same purpose, or is it just inherently harder to get people excited about repairing bridges rather than building them?

In my section about the media screwing the pooch, I do single out one USA Today reporter who was clearly assigned to write bad stuff about the stimulus. One week he’d write there was too much for rural areas, the next week too much for urban areas. But my favorite story, right after he said the stimulus wasn’t spending fast enough, was “Traffic Set to Slow As Stimulus Spending Gears Up.” A cloud in every silver lining!

But this was incorrect: By every measure, Obama’s stimulus was far greater than FDR’s New Deal. It involved more dollars in absolute terms and even accounting for inflation. It represented a far greater share of the U.S. economy. It was openly devoted to fiscal stimulus in a way that the original New Deal hadn’t approached until five years of FDR’s administration had already elapsed. And its impact on the economy has been far more pronounced than that of the New Deal.

Are you counting the bank bailout, the largely unused program to save people’s homes and keeping the Bush tax cuts as stimulus?
My grandfather got actual Work during the Great Depression I don’t see Obama creating any actual work.

No, I think that’s wrong. Whatever you think marginal tax rates should be, you will be very hard pressed to find an economist who thinks it would make sense to raise them at a time when the economy is hurtling towards a depression. The stimulus included the largest middle-class tax cut since Reagan, putting money into the hands of 95% of working families. As bad as things are, they would have been worse without it.

I’m struck by the story in the last day or so about Paul Ryan asking for stimulus money for projects in his district. His first reply when asked about it was “I did no such thing” but when the letters with his signature turned up, his answer became “that was ‘constituent services’ and not praising the stimulus.”

To a certain degree, this is CYA; but to a lesser degree, it reflects the disconnect not only among politicians but also with the media when it comes to stimulus spending. Even now, this story is getting attention as Ryan speaking out of both sides of his mouth. What’s missing is the fact — not opinion, but fact — that this money went out and created/retained jobs.

There was a bank bailout in the New Deal too–it was run out of the Reconstruction Finance Corp. by Jesse H. Jones, a great Houston business leader (and a Democrat). Jones entitled his memopir “Fifty Billion Dollars,” which gives you a sense of the scale of the Thirties-era bailouts.

As for “actual work,” don’t forget that the term “boondoggle” came out of some WPA programs sponsored by Harry Hopkins, who felt–correctly–that the great need in the mid-Thirties was to get mon ey into peoples’ hands.

Please. He didn’t make the case for a larger stimulus and said the one he got was just right. He was warned at the time what would happen. And it did.

By accepting a stimulus that was too small and saying it was just right, he discredited government deficit spending in a recession — perhaps for our lifetime. He did that all by himself. The Rs and the Press weren’t to blame for that messaging.

I don’t think people didn’t know what he was trying to do with the stim. , But the Right wing counter narrative is so deeply embedded in much of the public’s minds that the message didn’t ever have much of a chance to take root. On top of that by continuing the huge bank bailout started under BV$H he also played to the right’s narrative that he was bolstering the “bad guys” and he was and still is! As ironic and hypocritical as accusing him of supporting Wall st. was the GOP by creating a Faux populist movement ( the so called Tea party) managed with the M$M’s help to corral popular rage at these actions and turn them into electoral gains in 2010. His reward for helping the BIG Banks to be stabbed in the back and the front by these same people this yr.

I became aware that there was $90 billion in the stimulus for clean energy, when we were spending just a couple billion a year.

90 billion to companies to upgrade factories, hire people and give stockholders a payday is a waste of money companies need orders for product once they have orders bankers should loan them money.
I say should because bankers have been lending Frakers for Natural Gas money but Natural Gas prices are to low for Frackers to make a profit.
The Banks don’t allocate capital wisely but that is another problem.

Mike, that’s a great question. The stimulus did have its own icons – the world’s largest wind farm, a half dozen of the world’s largest solar farms, a brand-new battery industry for electric vehicles, zero-energy border stations and visitors centers, an eco-friendly new Coast Guard headquarters, etc, etc. Sometimes Obama has tried to call attention to them, as he did when he (alas) visited a new factory being built by a hot new solar startup called Solyndra. But it’s true that there was a greater focus on fix-it-first, which is more fiscally responsible and environmentally responsible than building new sprawl roads and whatnot. And some of the potentially iconic stuff has been blocked by Republicans – i.e., a bullet train in Florida, or a nationwide school building program that President Susan Collins insisted had to be removed from the stimulus before she’d support it.

Regarding what top marginal rates should be, i am reminded again of my favorite line from a conservative (!!!) economist–Herb Stein, Nixon’s chief economist, who wrote some years in the WSJ: “MY 60 years of experience tells me that whatever the degree of ;rogressivity in the tax code, the people who pay the top rate will think it is too much.”

Remember that when you hear about the dire necessity of cutting the top rate.

Ah, yes, the cash-and-trash Republicans. There were at least 128 in the House who voted against the freedom-crushing socialist stimulus and then sought stimulus funds. I consider that only mildly hypocritical. But most of the Republican caucus – including that Paul Ryan guy – voted for a $715 billion GOP substitute stimulus that was extremely similar to Obama’s $787 billion exercise in radical leftism. I consider that extremely hypocritical.

So banks get bail outed again but unlike when FDR did it we have no bank regulation the Credit Default Swap market alone has more imaginary money in it than we have money on the planet.
A bank bailout that does not stop bank gambling is useless and will cause another banking crisis.

I would agree he made a tactical error but the stimulus was large as it was. The Rs though provided no help whatsoever. In fact ole Mitch used every opportunity to knock Obama. In the end Obama got a few years of lower payroll taxes and more unemployment.

That’s an excellent point, and I thought you nailed it well in your book in reference to Scott’s killing of the Florida train. He’s not the only example–Chris Christie killing a tunnel from NJ to NYC that would be almost entirely financed with federal funds, and of course the parade of GOP governors swearing off Medicaid funds and fedral money for the ACA’s insurance exchanges. Any general thoughts on this outbreak of their cutting off their nose to spite their face?

Is it one more expression of the GOP’s determination to say NO to every Obama initiative?

As I said, I detail quite a few of Obama’s messaging mistakes in the book. But the idea that Obama ruined his presidency by failing to ask for more stimulus – how much? $2 trillion? still wouldn’t have closed the output gap! – strikes me as silly and ahistorical. Of course there’s no way to know for sure whether saying just the right thing in February 2009 would have changed everything. And I do think that Obama’s triumphalism when he signed the stimulus perhaps should have been tempered by more this-is-just-the-beginning rhetoric. (Rahm Emanuel was a big believer in celebration – he thought it made you look strong so that you could win the next fight, which Obama did, over the auto bailout.) In general, theories of Obama that depend on the black guy who managed to become president of the US even though his middle name is Hussein suddenly becoming a political idiot on 1/20/09 strike me as far-fetched.

So what was going on with the media back home in the districts of these folks? At the ribbon cutting events, were there stories that said “Gosh, if Congressman so-and-so had been successful and stopped the stimulus package, this event never would have happened”?

Sounds to me as if it was not only the DC media that was asleep at the switch, too lazy to do some real reporting, or too unwilling to call a lie a lie.

Seconded! The Right is actually using Obama’s half loaf not enough to stop starvation/save the economy as one of their biggest talking points along with Obama’s healthcare plan which was another half loaf satisfying nobody.
Heck America is the only nation in the world where poor Hispanic illegal immigrants without healthcare live longer than Whites who are citizens with healthcare.
Death Panels is what our current system is when ever Obama compromises America gets screwed and Lefty ideas are discredited.

Simple math: how could the same amount of money, $700 billion, that bailed out the banks (well that was the claim, we all know it was much much higher) bail out a whole country that was thrown into depression by the banks?

I think Obama believing that the GOP was going to put aside it’s idealogy and help the country was at best pollyannish on Obama’s part and at worst naive for any politician. Yes, the D’s did such things, but that’s because they always wanted to believe BV$H was somehow a patriot and we were @ War. The Reptiles only hold an allegiance to themselves not the country.

Remember: in January 2009 people were talking about how the R’s were on the road to extinction, and Obama’s approval ratings were at 70%. I recount the secret meetings where Cantor and McConnell laid out their strategy of no, and given my enthusiasm about the stimulus I obviously don’t think the strategy was good for the country. But it was ballsy, and politically, it was brilliant. McConnell remembered the Reagan landslide of 1984, when every Democratic senator except one got reelected because voters were in a good mood about Morning in America. (The one D who got beat lost to a guy named Mitch McConnell.) He told his caucus: If Obama miraculously turns this thing around, we’re all going to get reelected no matter what we do, because voters will be fat and happy. But if the economy is still in the tank, and it probably will be, that’s our ticket back to power. He was right.

As I said, I detail quite a few of Obama’s messaging mistakes in the book. But the idea that Obama ruined his presidency by failing to ask for more stimulus – how much? $2 trillion? still wouldn’t have closed the output gap! – strikes me as silly and ahistorical.

Cut the military budget to twice what China who has the next biggest army has. Raise taxes on the rich to 90% like FDR did. Before you mention WW2 spending lets remember that aside from keeping us all from speaking German a worthy goal.
All the WW2 stimulus spending did nothing to help our economy like a road or new school would there was no return on our investment it was Make Work with no return on the investment.
Ok Finland paid us back.

Nope! Very little of the narrative in this book has appeared anywhere else. I often felt like I was writing about an alternative-universe stimulus that was on time, under budget, virtually fraud-free, full of good-government reforms, and transforming the country.

I can’t,quite get there. As I said we ave now had a trillion and a half deficit for four years running. When is,the last time anything like that,has happened. One would think that kind of deficit would have a big impact. That it was not enough shows,the depth of the recession and the need of people, to deleverage. I do agree we need more. But in this climate it won’t happen.

In addition to continuing high unemployment, as mentioned above, poverty is at a record high, homelessness is at best stagnant, and most of the gain from the recovery went to the top 1% and especially to the top .01%.

It’s difficult to see lack of enthusiasm for the stimulus as a “messaging” problem, rather than a real problem in the lives of real people and communities.

It’s also difficult to see how Obama and the Democrats, by “pivoting” to austerity, and rarely if ever mentioning poverty, homelessness, or other devastating problems that confront our country, can expect to have any credibility as understanding, let alone being able to solve, these problems.

It may have involved more dollars in absolute terms then FDR’s New Deal but 1/3 was tax cuts, 1/3 went to states that bought a year or so of payrolls of people that were already working, and the rest, well, went to “projects”. I looked at the website of the the Recovery act and saw things like non profits getting funding, Subway shops being given money (how was that possible I have no idea) and even business scoping up money but there was no direct hiring for the millions who had already been thrown out of work.

I encourage you all to read the book; Obama was somewhat surprised by the uproar over honeybee insurance and sod on the Mall and whatnot, and he did expect more cooperation on a jobs bill during a jobs emergency. But he was less naive than many think. Throughout his presidency, a lot of what seems like clueless reaching out to R’s was motivated by centrist Democrats who wanted assurances that Obama was making every effort to be bipartisan. And there was a political aspect to all this; one WH official compared it to dealing with Iran, where you extend your hand even though you know the other guy isn’t going to take it, because you want the world to see you extending your hand. There’s a reason Obama is WAY more popular than congressional Democrats. He’s a front-runner despite 8% unemployment! That’s impressive!

With about 35 cars per 1,000 people in China’s 1.3 billion-person population, roughly 80 percent of car sales in the country are currently made to first-time buyers. As Josie wrote for GigaOM Pro (subscription required), this potentially lowers the barrier to adoption of alternative vehicles. Nearly half of the more than 5 million electric vehicle charge point installations anticipated worldwide by 2015 will happen in China, according to Pike Research. In addition, the government-owned utility State Grid Corp. plans to invest $586 million in a smart grid buildout over the next five years.

China has been investing in a green economy across the board, including clean power, energy efficiency and plug-in cars.

the best (rough) estimate of annual cost to the U.S. economy due to power outages: $100 billion or nearly 1 percent of the economy (pdf: page 4). For a fraction of that cost, investment in modernization of the grid (smartgrid and otherwise) would nearly eliminate that cost and provide other benefits (such as more efficient use of energy) that would boost the economy.

My bold $100 billion savings a year if we invest in a smart grid. Thats what we call a good return on investment.
Plus it would create jobs now. Investing in banks just keeps the Credit Default Swap gambling from having to admit losses and that the money is imaginary.

Again, I don’t want to be rude, but that’s crazytalk. World War II got us out of the worst depression in American history! I happen to think that cutting the military would be a very good thing to do, but not during an economic freefall!

That’s an easy question to answer: The last time we had deficits at least this high as a share of GDP was 1942-1945–when they were actually two to three times HIGHER than they are now. Don’t know if you’ve noticed, but that was also a period of war and economic stimulus–and the growth inspired by the programs of 1933-1945 allowed the country to turn the deficit into a surplus by 1947.

These are valid concerns, but again, let me remind you of the situation in the fourth quarter of 2008, when GDP fell by -8.9%. Read that again: -8.9%. That’s a depression! At that rate we would have lost an entire Canadian economy in 2009. And yes, it’s true that homelessness has “stagnated.” That’s miraculous! It hasn’t increased! You know why? Because the stimulus included an incredibly innovative new $1.5 billion “homelessness prevention” program that has helped keep 1.2 million Americans off the street by helping to pay their utilities, some back rent, etc. If half of them had lost their shelter instead, homelessness would have doubled. Similarly, poverty has gone up, but just the direct transfer payments in the stimulus lifted 7 million Americans out of poverty, and made more than 30 million poor Americans less poor. We can all agree that 8% unemployment and 2% growth sucks, and it’s lame to say things could’ve been worse. Still true, though.

Redirect the spending to something that gives us a return on investment like a smart grid. As far as being rude goes prove me wrong words like crazy talk are cheap. Get some facts show me how building tanks in WW2 or the billions Reagan spent on Star Wars have helped our economy more than rural electrification, Hoover Dam or other FDR New Deal work projects.
This is FDL attack the ideas not the person.

No, not just absolute dollars. The Recovery Act (just one bill) was more than 50% larger than the entire New Deal (a slew of bills) in constant dollars. The aid to states did more than save a few jobs for a year; it prevented mass layoffs at a time when mass layoffs (which means more teachers and cops on unemployment, which means they’re spending less money, which means more grocery clerks and clothing salesmen on unemployment, and so on) could have plunged us over the abyss. The fact that we’ve lost 500K public-sector jobs in the Obama era is a reminder of how many more we could’ve lost without the help of the stimulus.

Michael, I number myself among those who are distinctly unimpressed with Obama’s performance with respect to the stimulus package of Spring, 2009. It is not that it was too
o small by half, and that he had full information on that truth, but that it was loaded to the least effective form of fiscal stimulus–tax cuts. I am a professional economist of 40 years standing in a major university and I lear ned my macro f rom James Tobin. The utter inadequacy of the measure, which is the main reason why the current rate of unemployment is so high, is beyond discussion atx this point.

What is not beyond discussion is w hether he could have done a better job or is simply not up to the job of being President. I lean to the latter, but it is certainl y something we can debate. From here it doesn’t look like he was trying very hard to get a better package, whether this is to be laid at the doorstep of Geithner or to hibs native pusallimity is hard to say.

As to the comparison with FDR, it has been known for more than half a century that the pre-war New Deal was at best neutral with respect to aggregcate demand stimulus, and looks good only in comparison with Hoover’s strongly contractionary budgets.

Leaving aside that Hoover Dam wasn’t an FDR New Deal project (see my book “Colossus: Hoover Dam and the Making of the American Century”), building tanks in WW2 in the United States put thousands of workers–many of them Rosie-the-Riveters entering the workforce for the first time–and helped create the pent-up economic demand that drove the expansion of the late 40s, and 1950s.

That’s not to say that armaments are the key to stimulus, but only that if FDR had put as much into peacetime stimulus, there would have been even more growth in the 1935-1941 time span. (Federal spending as a % of GDP rose to 10-10.6% in the mid-30s, but 43.6% in 1943 and 1944.)

This is a response to many austerity questions: Obama has not pushed short-term austerity. He fought off the Republican push for short-term spending cuts; so far, the only tangible austerity measure that has been passed into law is the so-called “fiscal cliff,” which doesn’t take effect until 2013, and, if the history of Washington is any guide, will never take effect. It is true that Obama is very much interested in medium-term deficit reduction, particularly through the reduction of health care costs. Reasonable people can disagree – it probably won’t surprise readers that I agree – but he has been consistent about opposing short-term anti-stimulus.

I wonder what the split is on Obama’s stimulus how much went to banks, how much to tax cuts for the rich, how much to save jobs? AIG was a gambler so saving their jobs but not regulating them just gets us in more trouble. GE also got a bailout not because the business of making stuff was in trouble but because GE finance was in trouble for gambling. So I don’t think its fair to count bailing them out as a good idea.
GM was a great bailout America regulated the car companies and forced them to make more high MPG cars right in time for $4+ gas in Chicago last I looked.
If anything Government needs more regulation.

Thanks for mentioning the smart grid! It turns out that the stimulus included $11 billion for grid modernization, which has leveraged much more than that in private spending. The stimulus has distributed more than 10 million smart meters, and has dramatically increased the digital monitoring of potential problems on the grid. An example in my backyard: A transformer almost blew during the 2011 Orange Bowl, but my utility had installed smart new equipment that monitors transformers about once every second instead of once every year, so power was re-routed around the hotspot and no one ever knew that the entire stadium almost blacked out. That kind of thing doesn’t have much of a political impact – nobody knew! – but it’s changing our world.

It is incorrect that “the pre-war New Deal was at best neutral with respect to aggregcate demand stimulus.” In fact the period 1933-1938 showed explosive growth due to stimulated aggregate demand, including that created by federal emergency employment–more than 8% growth in GNP per year. (Romer, 1992) But there wasn’t as much fiscal stimulus as there could have been, and the spending the New Deal did engage in wasn’t thought of as “stimulus” the way we do today. And it was debt-financed. It was very much Keynesian, though the New Dealers weren’t very familiar with his theories. Proto-Keynesian, I call it in my book.

Amen! One point to remember is that even stimulus spending on stuff you don’t like – I like Subway shops, but I can see why that commenter didn’t – gets money into the economy and boosts aggregate demand. Depressions happen when the private sector goes into hiding, and only the public sector can break the vicious cycle of lost income and lost confidence.

That’s not to say that armaments are the key to stimulus, but only that if FDR had put as much into peacetime stimulus, there would have been even more growth in the 1935-1941 time span. (Federal spending as a % of GDP rose to 10-10.6% in the mid-30s, but 43.6% in 1943 and 1944.)

Tanks are make work there is no return on the investment to America I do agree that if FDR had put all that money into peacetime stimulus there would have been more growth and thats exactly what I want.
I want the good effect of jobs being created plus I want a return on investment for America call me greedy under Reagan we had tons of arms spending but if you notice the American worker fell behind and the rich got richer.

I want to address this one, because this is a common mistake, and perhaps typical of the bad sales job on the stimulus: the bank bailout wasn’t the stimulus. That’s a different bill called TARP. But I must say I talked to several powerful congressmen who made the same mistake. The stimulus had nothing for banks, nothing for AIG, a few targeted tax cuts for business but nothing for rich individuals.

Yes, it’s lame to say it could have been worse. But it’s not lame to say that we’re still faced with serious problems, and the Democrats plan to make them worse with austerity.

If as you say 7 million people were “lifted” out of poverty, and yet poverty is worse now, and particularly if the lifing programs were temporary to begin with, or will be cut for the sake of austerity, then, once again, this isn’t a messaging problem about the stimulus, it’s a serious failure of governance that needs to be addressed.

Exactly. And the Obama team was very aware of the mistake FDR made by turning back to austerity (which he had promised during his extremely dishonest 1932 campaign) in 1938. There were some real tensions on the econ team in the fall of 2009, when Geithner felt like the economy was out of the woods and Romer was screaming for more stimulus. But those tensions were hardly apparent at all when Obama took office. And they had less impact than one might think, because Congress, even under Democratic control, was scared stiff of stimulus.

..and also seconding Mike @75: The butcher, baker, and candlestick maker doesn’t care to know, or care at all, where the visitor to his shop got his money, whether from nuclear physics, “make work” building tanks, or manufacturing solar cells. He or she cares that it’s green, and in circulation. That’s the principle of every stimulus provision ranging from digging ditches or bjuilding LaGuardia airport in the 1930s, to the Making Work Pay rebates in the 2000s, to the bullet train proposals today. The basic idea is that when the private sector withdraws from the economy, the government has NO CHOICE but to pick up the slack and maintain aggregate demand until the private sector returns–returnin in part in response to the government stimuus. It’s a positive feedback loop.

That’s a fair point – if you could tax the rich (very low anti-stimulus multiplier) and divert the money into public works (very high pro-stimulus multiplier) you could boost the economy overall. Pelosi raised this possibility in December of 2008, because she didn’t think there would be appetite in her caucus for a stimulus bigger than $600B! But there was even less political appetite in the House or the Senate for tax increases, so it didn’t happen.

Actually, if you study the New Deal of the 1930s, what you discover is that the parallels and similarities are astonishing. Same causes of the economic turndown, same demographics of the way the burdens were distributed, and, in principle, same policy response. It worked then, and it works now.

I do think that some of the answers have been rude. Moreover, the accusation of “ahistorical” is a double edged sword.

Obama was swept in to office with a wave of populist fervor which had been stifled for a generation. The scene at the mall with Springsteen and Pete Seeger was inspirational. The sight of John Lewis with tears in his eyes, unforgettable.

From the moment he took office, Obama showed his true colors. There was not a single populist in his entire inner circle. There was no left leaning economist to be found. No Stiglitz, no Krugman, not even Robert Reich!
The halls were littered with Goldman Sachs and Citi bank cronies.

There was zero effort to keep the engagement of the large constituency which had elected him.

Freezing the wages of federal employees….profoundly misleading comparisons of the government with the “American family,” Trillions to the banks.

The possibilities were limited because the only popular uproar was being orchestrated by the right.

Those are historical conditions that contributed to the limited ability to act.

Michael, to what extent does Ben Bernanke play into the book? On the one hand, the Fed is independent of both Congress and the WH, but on a practical level, both the WH and Congress act and react to what the Fed does and does not do.

Similarly, to what extent does the situation today parallel the situation at the end of the 1930s, before the war? All the screaming about deficits by politicians in the face of continuing long-term unemployment almost brought the 1930s recovery to a halt, and I fear the same is happening now as the GOP is all about austerity and the WH seems willing to grant them that discussion as opposed to saying “Austerity kills at a time like this!”

I just think this kind of rhetoric is very odd. For example, in 2011, President Obama proposed an American Jobs Act that included more public works, more money for schools, and more tax cuts for working families. It didn’t go anywhere because Republicans opposed it. But both sides weren’t equally at fault. There were a lot of questions early on about Obama’s messaging problems, and some of them were self-created problems. But it didn’t help that while Republicans and the right stuck to a relentless message of big-government mess regardless of the facts, Democrats and the left spent most of their airtime during the stimulus debate complaining that there were too many tax cuts, or not enough highways, or not enough innovation, even though there was an awful lot of all that stuff. It just contributed to the impression of a big-government mess.

I don’t see how when the financial sector is now 40% of economy, resources are much more depleted, our manufacturing base has been hollowed out and most importantly there is no rule of law in this coutnry for the criminal elite.

Different solutions are needed entirely and we aren’t not getting them. That’s why we are still falling over the cliff but people have put blinders on so think we have somehow saved ourselves.

I do not want to get into an acamic argument woth you, but there is a famous paper in the AER from 1956 which did the first calculations of the coursr of the adjusted full-employment budget in the New Deal which demonstrated that it was slightly contractionary.

For those of you on the outside the adjustred full employment budget tells yoy whether, at full employment, the budget would under the current tax and spending regime be in surplus (contractionary) or in deficit (expansionary). A contractionary full employment budget is what we call ‘fiscal drag’, because if hypothetically the economy were to be operating at full employment, tne surplus would drag it back down. There is thus no way that FDR’s budgets coild have produced full employment, and they didn’t.

one thing we have’t explored is the common dig at Obama that he allowed healthcare reform to “distract” him from economic recovery. Obviously, medical technology is a cornerstone of the stimulus, as you make clear in your book. What’s your view of how healthcare reform fit into the broad economic agenda?

Well, the entire econ team except Geithner left in 2010. But if you read the book you will see that Romer herself shoots down the myth that she was pushing for a $1.8 trillion stimulus but got muzzled by WH austerity fiends. The entire econ team, including Romer and Jared Bernstein, wanted to step on the gas in the short term and step on the brakes in the medium term, although of course there were differences in gas-brakes emphasis. And ultimately you could only do as much additional stimulus as you could squeeze through Congress. Nobody seems to realize that Obama squeezed through quite a lot. It wasn’t easy.

She quit. I chatted with her on this a year ago. Plus, traditionally the normal term of service on the CEA was two years, which was about the max a n academic economist could do and still stay on top of his or her field. That’s not so true anymore, but shwas exhausted from non-stop 15 hour days.

Michael G, do I remember you from Harry Shearer’s The Big Uneasy, about how the Army Corps of Engineers was responsible for New Orleans flooding? I saw it when he presented it in Los Angeles with an audience question-and-answer afterwards. If I have the context right it was that the Army Corps of Engineers was out of control and unfixable from the time legislation (in the 20s or 30s?) gave them immunity. There’s no penalty for getting it wrong, and they get it wrong all the time and do huge damage but can’t be held responsible. Your point iirc (yes?) was that a string of presidents have tried to fix it but failed, and whistleblower Maria Garzino’s story showed how you couldn’t change it from inside/below. So the upshot is the ACE is unfixable from the inside or outside and unfixable from the top or bottom.

Yes, well, there’s been a LOT of study on that question in the last, er, 56 years that challenges the conclusion that the New Deal was contractionary. See, for example, Eggertsson, FRB of NY, 2008, with an extensive bibliography. At this point lit’s little more than an ideological claim.

In fact, manufacturing has been one of the bright spots in recent years. And one reason has been the clean-energy manufacturing boom created by the stimulus, but unnoticed except for that one factory in Fremont, California. For example, in 2008, the wind industry was dead, and after the financial crisis, turbines were left to rust in the fields. Thanks to the stimulus, US wind power has doubled since Obama took office. And the domestic content of US turbines has also doubled! Of course, Republicans are still running ads accusing Obama of outsourcing wind turbines to China. Because they can.

From what I read over 80% of the stimulus money that went to wind energy went to foreign companies.

As to renewable energy alternatives that created manufacturing jobs, the spending was a drop in the bucket compared to what China spent doing that time. (our money here went to the banks and to the military)

And it faces having any and all support pulled if the Republicans regain the government.

Thanks…I find this whole debate fairly scary. We have very smart people here who cannot agree. So where does that leave the very antagonistic Rs. and Ds…..So many in the country are dissatisfied and/or scared. Where are some leaders to educate, inform, and lead? Surely not among the TeaParty who seems to have the most vocal team. Suggestions?

What’s really hypocritical is voting against the stimulus, requesting stimulus money and then posing with your constituent recipients alongside the giant Publishers Clearing House check — and managing your local news media so that they never bother to print the first two items when featuring the photo of the Big Check you pass out to locals.

“To the point of your book, you may be giving Obama huge credit for spending money with an environmental tag, but is anyone checking the environmental wisdom of what he’s funding?”

I would echo this point re: spending with an educational tag, for example
Race To The Top. Who is checking the educational wisdom of teaching to the test and the Charter School movement to gut public schools?

This is a VERY important point, a legitimate point for debate about Obama. I tell a story about how in the fall of 2009, he said to his econ team: “Look, I get the Keynesian thing, but it’s not where the electorate is.” So he stopped talking about it. That said, he’s done more Keynesian stimulus than anyone ever has. As an environmental writer I hear a lot about a similar issue, his refusal to talk about global warming. What I always point out is that Obama has done far more than any president to address global warming; Clinton proposed a five-year $6 billion clean energy plan that went nowhere, and 10 years later Obama got $90 billion before most of his staff knew where the bathrooms were in the West Wing. Solar has increased 6X on his watch. The smart grid is happening. He’s financed 30 battery factories for electric vehicles, when before we had none. And so on. All of that is helping to break our dependence on fossil fuels and our carbon emissions, which are shrinking even though the economy is growing. But he doesn’t think it makes political sense to talk about global warming. This is one of the ironies of Obama: during the 2008 campaign, the rap on him was that he was a words guy, but he turned out to be more of a deeds guy. He campaigned as a change-the-system outsider, but governed as a work-the-system insider. And he’s gotten a lot done.

DAVID CAY JOHNSTON: Well, seven years ago Congress passed something called the American Jobs Creation Act.

HARRY SHEARER: Well what could be wrong with that?

DAVID CAY JOHNSTON: Right. With a name like that, how could you not be in favor of it, right? And right now there is a proposed new American Jobs Creation Act. And it said, if you have offshore profits, you may repatriate them to the United States and instead of paying the 35% corporate tax, you only have to pay 5¼%.

The biggest beneficiary of this law back then was Pfizer. And Pfizer saved 11 billion dollars in taxes.

And what happened the day after they repatriated this money for very little tax? They started firing people. And they kept firing people until they fired 40,000 people. I’m not sure that they’re through firing people at Pfizer. Now, not all companies did this, but they got 1/3 of the benefits and it was clearly an American jobs destruction program.

So the new bill, like the old one, actually doesn’t require you to create jobs, despite its title. You can do all sorts of things with the money. You can use it to finance buybacks of your company stock. And executives, of course, like that because if there’s less stock out there and the company is buying it, it tends to push up the price of the stock, and that means their stock options are worth more money – all thanks to the generosity of you and I as taxpayers.

In the EU, for instance, 150 million workdays are lost each year due to work accidents, and the insurance costs to be borne by industry add up to 20 billion. And American businesses spend US$170.9 billion a year on costs associated with occupational injuries and illnesses.

My bold The EU has tons more worker safety regulations than America does Obama and the GOP both call Government regulation job killers. So lets look at the math $20 billion vs 170.9 billion for an as of 2010 EU population of about 501.26 million people. America in contrast has 311 million people, but we have over 8 times the cost of workplace safety injuries?

my bold An often overlooked part of FDR’s saving our economy was MORE government regulation.I am sure our economy could use an extra $150.9 billion add that to the $100 billion a smart grid would save us a year and we could easily pay back a trillion in job stimulus.
Return on investment as opposed to more military spending which everytime we go to war and use our army we add to the national debt.

Oh, that makes me crazy. Yes, a lot of the wind money went to foreign companies. But who cares whose corporate name is on the polo shirts? The factories were built in the US. In 2008, Abengoa (a Spanish company) was shutting down its US projects, because after the financial meltdown, there was no investor appetite for the tax credits that help finance wind farms. (Yes, those are the tax credits that Mitt Romney wants to end.) But the stimulus transformed the credits into tax grants, and the day after it passed the CEO of Abengoa announced that he was investing $6 billion in US projects. That’s a good thing!

I haven’t read your book, so if you have clarified this further, please excuse my lack of understanding. but when you say “Thanks to the stimulus, US wind power has doubled since Obama took office” what does this mean to energy in this country? Doubled from what, and how does it compare to increases in fossil fuel extraction, like off-shore drilling, fracking, and mountain top removal? Once again, there is not necessarily a messaging problem about the stimulus, but a real problem in our country and whether it is being addressed.

That’s right. And back in FDR’s day, there were pro-New Deal Republicans. Obama understood that bills that don’t pass Congress don’t make change. The tyranny of 60 votes meant that the process wasn’t pretty, and Obama had to accept some stuff he didn’t want. Olympia Snowe demanded that they keep the (totally non-stimulative) alternative minimum tax patch in the stimulus as a favor to Chuck Grassley, who was trashing the rest of the bill. Rahm told me it was the strangest $70 billion he ever spent. But what else could he do? As Christy Romer told me: Depressions really, really suck.

When Obama took office, there were 25 gigawatts of wind power in the US, and the official EIA forecast said there would be 40GW by 2030. Today, there are already 50GW, and the first few GW of solar, enough to power about 15 million homes. And the price is going down, and fast, as opposed to the price of coal, which is going up. We’re much closer to the day where renewables can compete on a level playing field. In California, you can get a 20-year solar contract for no money down, and what you pay over time is less than what you’d pay for electricity.

Just to amplify that point, FDR had anything but clear sailing in Congress after the Hundred Days. He had to tailor his policies to account for conservatives on both sides of the aisle–he killed an anti-lynching bill because he knew the Southerners woujld tie up his entire program with a filibuster, and he scaled back the Securities Act of 1934 so far that progressives, such as the New Republic, cursed him for it. “The New York Stock Excahnge wil remember Roosevelt with gratitude,” it wrote (This was the act that created the SEC!) Maybe he was better overall at dealing with his opponents than Obama, but he had to learn over time, too.

We haven’t talked that much about what’s in my book, but in addition to a lot of fun fly-on-the-wall stuff from inside the WH and the backrooms of Congress, and a lot of hilarious Biden being Biden and Rahm being Rahm, there’s a lot of reporting in battery factories and high-speed rail meetings and yes, that unfortunate solar manufacturing facility in Fremont. I really do follow the money. And I think you’ll be very surprised by what I found.

Mike, during the primary battle, the contenders for the GOP presidential nomination tended to take shots to one extent or another at the original New Deal, partly as a way of attacking the incumbent’s modern-day program. What’s your perception of how Romney and Ryan will treat the principles of the first New Deal during the campaign, and how they’ll use it against Obama?

Foreign Tech means American Engineers go unemployed. It means we are dependent on other countries to invent stuff. When America losses all its expertise we become dependent.
The reason the Japanese, Germans etc build car factories in America is because we can build our own cars and if the economy gets bad enough we can ban all foreign cars.
Otherwise Mexico is right near by and has much cheaper labor, China has cheaper labor. America once mined Rare Earth Metals then the Chinese flooded the market with Rare Earth Metals and so America stopped mining rare earth metals and guess what the jobs are gone.
Rare Earth metals are really really poisonous to mine that requires specialized knowledge and in a generation that knowledge will be gone.

Well, I will say that some of the disagreements are more political than real. As nauseating as some people will find what I uncovered about the Republican plot to destroy Obama before he even took office, I take some heart in the notion that much of their opposition to sane policy is pure strategy. In January 2008, every D & R presidential candidate proposed a stimulus package – and Mitt Romney’s was the largest. As I mentioned, Ryan and most other R’s voted for a $715B stimulus that wasn’t all that different from Obama’s. (Less green stuff, no NEA or Americorps or youth jobs programs, more Army Corps of Engineers pork.) It was only after 1/20/09 that all this stuff became sharia socialism. And you still hear R’s making Keynesian arguments: don’t cut the military, that will kill local jobs! don’t raise taxes during a recession! Similarly, of course, the individual mandate for health care was a Romney thing, and the McCain-Palin ticket supported cap-and-trade. Someday, maybe the fever will break.

All of that is helping to break our dependence on fossil fuels and our carbon emissions,

Look, that’s the thing, I thing he’s ensuring our dependence on megacompanies for energy and whatever their choice of dirty fuel is. I’m in Southern California and here we got the greenwashed Sunrise Power Link and the Ocotillo Wind Express. The upshot of both of these environmentally miserable projects is that Sempra Energy gets greenwashing and taxpayer support while locking us into a dirty energy future with imported LNG burned in Mexico for power carried over Sempra powerlines through the most flammable part of California’s backcountry, INSTEAD of going to the smarter idea of decentralized local rooftop energy, which is like a no brainer for San Diego, why import “solar” energy here? Or wind energy from the desert where it fails to meet the minimum wind strength requirement?

If the project is going to generate only a fifth of the power promised by proponents, and the hidden costs are staggering and irreversible, why hasn’t the federal government halted the project and weighed whether federal subsidies should be withdrawn?

I think monetary policy has been too tight but I think Bernanke was a totally understandable call. He sure as hell wasn’t too hawkish in 2008. And FWIW, although many people I respect disagree with me, I’m skeptical that much better monetary policy would have made much of a difference. He could have poured more money into bank vaults, but he couldn’t force banks to lend.

My nomination for biggest Obama mistake is killing the transportation bill in 2009.

I would add “new ways of doing unemployment insurance” as I think this meant reducing the number of months, allowing states to do drug testing, and allowing states to use the money to subsidize employers, rather than unemployed people.

Lots of argument lots of ideas sparked so I at least think this is a good thread its nice when everyone agrees and we can make plans and build on each others ideas. But you learn more through conflict and testing the ideas you thought were right.

Michael Grunwald, over and over again, you make the point that the Republicans obstructed Obama and frustrated his efforts to achieve actual “progress for” the middle class and the poor working class.

And … yet … you do recall that Obama has sought, again and again, “bipartisanship”?

I realize that your “topic” has no interest in certain things.

However, to speak of economic “progress” when the criminal fraud of the bankers, has neither been sufficiently exposed NOR sufficiently punished, indeed, Obama made the point of saying that the Wall Street Bankers did nothing “illegal”, “immoral” yes, but not illegal … and that was because Glass Stegall was removed as a barrier to poor practice, to “speculation” by Bill Clinton. Whatever economic positives the stimulus might have added, the “bail out” of the too-big-to-fail banking system, where the big banks are bigger now, effectively impoverished this nation, especially when the cost of the endless wars and the Bush tax cuts, which are now the Obama tax cuts, are factored in.

As well, the Rule of Law has been made mock of, time after time, on many levels, and Obama’s assertion of the power to kill anyone, anytime, and any where that it suits him, without due process of law, can hardly be seen as New Dealish, at least in my opinion.

It’s a good question. I think most Americans, with the exception of Tea Party types, still feel pretty good about the New Deal. I assume that Romney and Ryan will try to portray Obama (not just the stimulus but definitely including the stimulus) as way beyond the New Deal consensus. I’m reminded of Romney saying that of course nobody’s talking about taking apart the safety net – well, he is, and his running mate is, but he knows enough not to say so.

I would also add, what about the Keystone Pipeline?
Environmentalists agree it will be a disaster – a global warming tipping
point – but it seems the President is not able to take a firm stand against it Meanwhile construction has already started.

In fact, there were $7B worth of incentives for states that expanded their unemployment insurance programs to include part-time workers, workers who have to leave jobs to relocate for a spouse, and other employees who didn’t get covered by a system created for a male-dominated workforce. I believe 31 states took advantage of those incentives. And they will be in place for the next recession, expanding the countercyclical safety net.

I wonder how many employee work days were lost before FDR started regulating government more and how many work days were lost after FDR created more business regulation? I wonder what the cost to the economy was?
After FDR we had fewer Bank failures once Clinton got rid of bank regulation I wonder how much that cost. The Savings and Loan bailout is another example of deregulation costing the economy money.
Sometimes I listen to Ron Paul, Rep Ryan and Mitt talk and I wonder just where did they study economics?

Thank you so much for participating. I really enjoyed the questions, hostile and non. And I hope you’ll all take a look at The New New Deal – regardless of your politics, I think you’ll learn a lot about how our government responded to the crisis, and what our government has been doing with our money. Also, thanks to Mike, who’s a terrific writer and clearly a great questioner as well.

Looking Back on the Stimulus: What did it mean for the US? What did it mean for clean energy?

A Discussion with Michael Grunwald, senior national correspondent for TIME Magazine and author of The NEW New Deal: The Hidden Story of Change in the Obama Era

Much has been reported on the Recovery Act’s sweeping provisions for renewable energy, yet few truly understand this ambitious and controversial piece of legislation. Michael Grunwald, journalist and recent author of The NEW New Deal, will share his account of one of the most sweeping bills in U.S. history— how it happened, how it’s transforming our energy economy, and how it’s being distorted by the Washington fun house.

far too late to this thread, too many comments to find out if my point were already addressed, anyhow;

But this was incorrect: By every measure, Obama’s stimulus was far greater than FDR’s New Deal. It involved more dollars in absolute terms and even accounting for inflation. It represented a far greater share of the U.S. economy. It was openly devoted to fiscal stimulus in a way that the original New Deal hadn’t approached until five years of FDR’s administration had already elapsed. And its impact on the economy has been far more pronounced than that of the New Dea

you want to call obama’s transfer of middle class dollars into the hands of the people who caused the problem a “stimulus”?

if that’s what you want to call a stimulus then you could also call the great bank robbery a “stimulus”

the money obama gave to the people who caused the problem SHOULD have gone to the labor class, instead obama used the ridiculous “top down” or “trickle down” economic “strategy” who’s only real purpose is giving middle class assets to the wealthy.

so you might call it “stimulus” and you might claim it diverted a catastrophe but it was a theft and a transfer of wealth from the laborer class to the investor class

I had an embezzler steal my dad’s estate, he transferred my families wealth over to himself…by your measure this is some kind of “stimulus”

obama failed the middle class, took our assets and we will not recover so long as the wealthy can purchase their politicians

so books like this are supposed to get the middle class voting for obama again

obama is the trojan horse, the wolf dressed as sheep, he has passed more corporate swill then any republican could have dreamed

Ditto for $27 billion to drag our pen-and-paper health care system into the digital era, so that doctors stop killing us with their chicken-scratch handwriting. And high-speed rail, the largest transportation initiative since Eisenhower. And high-speed Internet for undeserved communities, a modern take on the New Deal’s rural electrification. And new ways of doing unemployment insurance, homelessness prevention, financing of local infrastructure. And the largest research investments ever. And so on, and so on. It became obvious that there was a gigantic story hiding in plain view.

were these “stimulus” dollars given to corporations for “private sector” low wage jobs with tons of money going to the ceo or were they public sector high paying good retirement good health care jobs?

which one?

I am guessing “private sector” top down “stimulus” not bottom up investment

when there are too many people who need jobs, your “stimulus” shouldn’t include firing people, when you have too few jobs to go around your “stimulus” shouldn’t include raising retirment age, when you need more money into the economy your “stimulus” shouldn’t be directed at low paying jobs, your “stimulus” shouldn’t give your tax dollars to the wealthy in the guise of “tax cuts”

you shouldn’t be giving “tax breaks” for exporting our jobs over seas…that’s what i mean

I have a date everyone

but one thing everyone must keep in mind;

“trickle down” MEANS top down, giving your assets to the wealthy and pray they create jobs with it…how OBSURD…a dollar to someone to hire is worth less then 50 cents over a dollar to hire someone instead

do not accept “you give to the corporations so they can hire more people” crap

Actually I would like more than that. Maybe take an issue at a time. Like what are you referring to about low paying jobs? Or firing people? I am sure there are the one off examples but I don’t see it. What tax cuts are you referring to? There were tax cuts for middle class people ion the stimulus. Some tax cuts were necessary to get it past congress.

The stimulus was not enough. But I’ve said this before. It resulted In really huge deficits for four years now. And it is still not enough. There are plenty of blue dogs and all the Rs who find that evil. The damage done by the housing bubble was the worst since,the great depression. It came a hairs breath from a depression. And when themty five million are still looking for work maybe it is a depression. Personally I would set up a government jobs program at the minimum wage and hire everyone who showed up. Try to get that past congress.

My issue now is cutting the deficit will throw us back into recession.

How many recent college graduates are working at jobs worthy of their education?

How many people are working two jobs and working at temp jobs which provide no health care?

How many employers are cutting back staff and loading more work on those who remain?

The Bush, now the Obama tax cuts … mostly benefiting the wealthy … continue … all the “rest” is empty “promise”

How many federal employees have been laid off since Obama come to power, and, indirectly, how many state government employees … and teachers?

And, are you suggesting that the “recession” is over, bluedot, that “we” are “out” of it?

Would not abundance, rather than austerity, be the means of revitalizing a civil society where the wealthy have off-shored our productive capacity, making us dependent on the whims of others, and, at the same time, depriving the people of worthwhile endeavor at a living wage?

Is not Obama fully behind cutting the deficit … touting a “grand bargain” as the “means” … and has not Obama suggested that he might select Erskine Bowles as Treasury Secretary?

What has Obama and his “party” really TRIED to “get past” Congress? Ever?

Frankly, I don’t know what perris had in mind, but I suspect those are “some” of the things …

You presumably know the answers to those questions. So tell us. And the reasons given for each of them. Do you suggest the Romney will right all the ills you see? A chicken in every pot, I say. Make that happen if you can. We need more,clarity than supposing things and the alternatives are also critical to understanding. Oh did I say the recession is over? I think I said there are,twenty five million looking for work. Sound like I think the recession is over?

I suggest that Obama will not right any of the ills which are verifiable, by everyone and anyone who cares to understand, bluedot.

I suggest that there is “enough” of the resources of life to go around, that, among the political class, which includes the media, however, greed and the conviction that money is all that matters IS the essence of the “bipartisanship” which exists “between” and “around” the legacy parties … that they are gaming us and engaged in deliberate Kabuki performances to divide and ton confuse us … to frighten and abuse us, and that “more of the same”, of EITHER “brand”, will simply push the majority of us into greater depression and neo-feudal conditions, which is precisely what those whom both legacy parties serve … WANT to happen.

I think THAT desire foolish and potentially heralding the end of our species.

Were we to reorder our priorities toward the appreciation of life and not about money, then I am convinced that we might, just possibly, survive … and, if we can really may perceive that the purpose of life IS living and not amassing money or seeking power over others … then I consider that we might well thrive.

A choice of the lesser evil, is NO choice at all… merely consenting to the dictates of the masters, to bondage, suffering, and human defeat.

However, you need not FEAR, bluedot, your man will “win” and the many shall lose … this time … once again.

And this “time” will be when the true designs of the powerful shall be fully revealed … and from that revelation shall arise terrible and necessary understanding.

In the meantime, and it will be a very mean time, indeed, we shall all see what we see and learn what we learn …

And with that, I bid you my hopes that we all shall survive and come to appreciate one another … for ultimately, all we human beings really have to “spend” is time, in the company of each other, if we are lucky and blessed.

And if I may add by one small item, DW, to the list of Obama’s economic “achievements”: Instead of running around this country like a man with his hair on fire about unemployment and the disparity in incomes for the last three and a half years, he has repeatedly turned to deficit hysteria and deluded homilies about how the government budget is like a household’s budget — and nonsense about eating peas — while suggesting that cutting food stamps and social security and raising the Medicare eligibility age would help all of us, though of course there’s no point in holding anyone on Wall Street accountable for the misery in the first place. Indeed, the indispensable financiers and bankers must be made more secure, richer, more powerful. They, after all, are what politicos mean by “the economy.” (It was reported at the time that one of the reasons Obama gave Sen. Schumer for extending the tax cuts for the wealthy in Dec. 2010 was that he feared the stock market would crash otherwise.) Either Obama believes this deluded crap or he doesn’t, but the evil is all the same.

But as you say, DW, the only path forward for the rest of us is to steel ourselves and try to honor the humanity that remains. It will get much, much worse.

he is a quaterback working for the other team and it is impossible fighting corporate agenda when it comes from a democrat
if I had a football team and I knew my quaterback was throwing for the other team i would give the other team the ball and try to keep them from scoring, if my quaterback has the ball the other team definately scores

obama must loose his job

I don’t believe the Democrats will ever find their butts and do something good while Obama leads the party.

No, bluedot, what I said, and meant was about when Obama is re-elected.

Any further “push” for mindless austerity IS deliberately designed to punish the people and beat the people down … and despite what you may imagine, Barack Obama CAN and will succeed in DOING more EFFECTIVE harm than Romney-Ryan.

Romney-Ryan are simply to FRIGHTEN the people into consenting to being destroyed by the “loving graces” of “kinder, gentler, and careless” Democrats.

There IS no “alternative” …except real and actual alternatives … which the “wisdoms” among us cannot even bear to reasonably and rationally discuss.

Indeed, they insist that NONE of us should be allowed to consider anything BUT Obama.

Any further talk of this nation as a democracy, as being a “representative” democracy, is the most abominable of lies and talk of that sort is intended to salve the conscience of the fearful, to lull them into to “choosing” the non-choice.

Each of us shall have to “do” as our conscience and our humanity lead us, in our individual responsibility for ourselves AND for each other, to do …

ANY who crow and bray about whatever they decide to do are not to be trusted … for their own uncertainty leads them to seek the company of others who are equally fearful and equally uncertain … and those who would bully or seek to frighten others to follow them, rather than seeking to reach shared understanding are no better than the most evil of the political class … and evil is not a matter of degree, but of choice.

Thanks for making the point about Obama’s Race To The Top scheme, which has been described as Bush’s NCLB on steroids. I wonder if Mr Grunwald spoke with any public school children, parents or teachers about how RTTT is working out for them.

Rafael Correa: What is the difference between Republicans and Democrats? I think… I think I have more difference between myself in the morning and the evening than they have among themselves.
Julian Assange: [laughs] You could be right.
RC: Here, we are changing things and we need leadership, we need legitimate democratic power to change the structures and the institutions that exist in our country to serve the big majorities of our nations.
JA: Do you think Barack Obama is a good leader?
RC: I think he is a good person. But, of course, we expect much more, a bit more, regarding the changes that he could have done. We understand Obama is somebody… he’s not liked by the US elites and the great powers that exist in them. I think Obama is a great person, a great human being, but I think unfortunately has not been able to introduce the changes that he was looking for.

I was reading Kenneth S. Davis “The New Deal Years, 1933-1937″ and few people realize, in fact or folklore, that FDR was actually very fiscally conservative, and the Great Depression probably would have been less severe if economic stimulus had been greater. FDR accepted some things that passed Congress with which he disagreed, and relaxed anti-trust law for Big Business in exchange for union acceptance and higher prices, and in focusing on the need for higher commodity prices he was inflating every bit as much as the Federal Reserve today.

FDR was governing in a vacuum, there was little organized political opposition. Obama has had no such luxury, in fact he’s been often drowned out by Congressional Republicans. He has wielded power well, behind the scenes, and has clearly steeled the party for this election year. This is not a White House with the PR problems of Jimmy Carter’s years.

So the question I’d ask Michael Grunwald is, with so much success, and such a savvy media operation, why is this election even close, and what can progressives do about it? Is it simply a matter of the social issues that Tea Party conservatives use to disconnect voters from their own economic interests, or is it Washington GOP media strangulation? What gives?

I suggest you read another biography, almost any other neutral biography on FDR. FDR had lots of opposition including in his own party. You note that he had to compromise with people he disagreed with in congress. The notion that he was “governing in a vacuum” is utter nonsense. In addition to congress, remember the conservative supreme court that declared much of the New Deal unconstitutional?

FDR was a fiscal conservative. Keynes’ ideas hadn’t penetrated governments. He had to break new ground, to work it out as he went along. He tried everything and kept doing the things that seemed to work. He probably never heard the idea that a deficit could rise up to the revenue that would be created by full employment without harming the economy.

In 2009 economics did know exactly what needed to be done. Krugman and Stiglitz, and Christie Romer for that matter, calculated how large the stimulus had to be. Krugman and Stiglitz warned the country would be in exactly this sitution in this point in time with a stimulus of that size.

Maybe Obama couldn’t get more. But he certainly could have said the stimulus was a bipartisan compromise and many economists thought it was too small. If it wasn’t enough, he’d be back. He might not have gotten more then either. But it would be harder for the Republicans to run around saying we gave him exactly what he said he needed and it didn’t work.

And just one final comment since I know few will see it. I am surprised that anyone would compare Obama’s policies to the New Deal. One comment here had it partly right, that this is not in any way, shape, or form, a comparable project vis-a-vis stimulus to what President Roosevelt undertook in the ’30s. Only since we don’t have too many New Dealers alive any longer could Obama’s program be called a ‘new New Deal.’ Even Obama himself rather references Reagan than FDR – he shies away from the latter like the plague.

As posts here have pointed out, Obama for better or worse deals with economic ‘persons’, not the real ones who suffer as conditions worsen for them. FDR addressed the people and always his concern was for the public welfare. The policies he put in place to secure that are now under threat of dismantlement as the corporate wealthy he decried take more and more power and become more and more wealthy. That would have FDR’s anger like the thunder were he to rise from the grave – there is no new New Deal, not yet. Not till we have a president who puts the people first.